New Look completes refinancing deal

By

Sandra Halliday

Published
Nov 10, 2020

New Look has this week completed its major recapitalisation that “significantly reduces long-term debt and provides financial strength and flexibility to deliver a sustainable trading platform for the company,” it said.

The recapitalisation had been announced back in August and following the High Court’s sanction of New Look Financing PLC’s Scheme of Arrangement, it now has “the funding and flexibility to execute on its strategy”.

The deal included a debt for equity swap, reducing senior debt from around £550 million to just £100 million. Importantly this also heavily reduces the money it’s paying out in interest on that debt as servicing loans can be a major drain on cash flow.

It also has secured an extension of its primary working capital facilities, which provide further financial support with no near-term maturities. And It has an extra £40 million of new capital to support its business plan.

CEO Nigel Oddy said it all means the firm now has “significantly enhanced financial strength”. But he also acknowledged that the current market conditions are challenging.

With the company’s stores in England currently shut due to the latest lockdown, it’s clear that the company has a tough time ahead of it.